LOGIQ, INC. - FORM 10-Q

Attached files

file	filename
EX-10.1 - LOGIQ, INC.	v223857_ex10-1.htm
EX-32.1 - LOGIQ, INC.	v223857_ex32-2.htm
EX-31.2 - LOGIQ, INC.	v223857_ex31-2.htm
EX-32.1 - LOGIQ, INC.	v223857_ex32-1.htm
EX-31.1 - LOGIQ, INC.	v223857_ex31-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011.

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to ____________ to ____________

Commission File Number: 000-51815

SINOBIOMED INC.

(Exact name of registrant as specified in its charter)

Delaware		20-1945139
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Room 4304, 43/F China Resources Building 26 Harbour Road, Wan Chai Hong Kong, SAR People’s Republic of China		N/A
(Address of principal executive offices)		(Zip Code)

(+852) 2511-0238

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

o Yes x No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

o Yes o No*

*The registrant has not yet been phased into the interactive data requirements.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

o Yes x No

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

o Yes o No

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding as of May 23, 2011
Common stock, $0.0001 par value	226,971,586

TABLE OF CONTENTS

Use of Names		1
Forward-Looking Statements		1
Part I – Financial Information		2
Item 1. Financial Statements		2
Item 2. Management’s Discussion and Analysis or Plan of Operation		3
Item 3. Quantitative and Qualitative Disclosures About Market Risk		6
Item 4. Controls and Procedures		6
Part II – Other Information		7
Item 1. Legal Proceedings		7
Item 1A. Risk Factors		7
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		7
Item 3. Defaults Upon Senior Securities		8
Item 4. [Removed and Reserved]		8
Item 5. Other Information		8
Item 6. Exhibits		8

USE OF NAMES

In this quarterly report, the terms “Sinobiomed,” “Company,” “we,” or “our,” unless the context otherwise requires, mean Sinobiomed Inc.

FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q and other reports that we file with the SEC contain statements that are considered forward-looking statements. Forward-looking statements give the Company’s current expectations, plans, objectives, assumptions or forecasts of future events. All statements other than statements of current or historical fact contained in this quarterly report, including statements regarding the Company’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plans,” “potential,” “projects,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” and similar expressions. These statements are based on the Company’s current plans and are subject to risks and uncertainties, and as such the Company’s actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. Any or all of the forward-looking statements in this periodic report may turn out to be inaccurate and as such, you should not place undue reliance on these forward-looking statements. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and assumptions due to a number of factors, including:

·	dependence on key personnel;

·	competitive factors;

·	degree of success of research and development programs;

·	the operation of our business; and

·	general economic conditions in the United States and China.

These forward-looking statements speak only as of the date on which they are made, and except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this periodic report.

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SINOBIOMED INC.

INDEX TO FINANCIAL STATEMENTS

	Page

Balance Sheet		1

Statements of Operations		2

Statements of Cash Flows		3

Notes to Financial Statements		4

iii

SINOBIOMED INC.

Condensed Balance Sheets

(Expressed in U.S. Dollars)

	March 31			December 31
	2011			2010
	(Unaudited)			(I)
ASSETS

CURRENT ASSETS
Cash	$	29,472		$	200,176
Prepaid expenses and deposits		10,663
Total current assets		40,135			200,176

Fixed assets		10,000			10,000

Total assets	$	50,135		$	210,176

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

CURRENT LIABILITIES
Accounts payable, including related party payables of $5,000	$	97,128		$	97,128
Interest payable		0			42,559
Shareholder loans (Note 4)		40,000			40,000
Other current liabilities, including related party liabilities of $110,150		171,028			256,408
Total current liabilities		308,156			436,095

Convertible debentures		250,000			250,000
Total liabilities		558,156			686,095

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' (DEFICIT)
Common stock (Note 1)
Authorized 250,000,000 shares at par value of $ 0.0001 each
Issued and outstanding 226,971,586 shares (216,304,920 ended December 31, 2010)		22,698			21,631
Additional paid-in capital		33,025,523			32,892,007
Subscriptions received		95,014			95,014
Accumulated (deficit)		(33,651,256	)		(33,484,571	)
Total stockholders' (deficit)		(508,021	)		(475,919	)

Total liabilities and stockholders' (deficit)	$	50,135		$	210,176

(I) Derived from the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010. The accompanying notes are an integral part of these condensed financial statements.

The accompanying notes are an integral part of these condensed financial statements.

SINOBIOMED INC.

Condensed Statements of Operations

(Expressed in U.S. Dollars)

	Three Months Ended March 31,
	2011			2010
	(Unaudited)			(Unaudited)
EXPENSES
General and Administrative	$	155,911		$	161,107

Loss from Operations		(155,911	)		(161,107	)

Interest Expense		(10,774	)		(7,435	)

Net Loss	$	(166,685	)	$	(168,542	)

Net loss per common share - basic and fully diluted:

Net loss for the year	$	-		$	-

Weighted average number of basic and fully diluted common shares outstanding		182,176,885			144,021,592

The accompanying notes are an integral part of these condensed financial statements.

SINOBIOMED INC.

Condensed Statements of Cash Flows

(Expressed in U.S. Dollars)

	Three Months Ended March 31,
	2011			2010
	(Unaudited)			(Unaudited)
Cash flows from operations:
Income from continuing operations	$	(166,685	)	$	(168,542	)
Reconciliation of net income to cash provided:
Imputed interest expense on shareholders' loans		-			531
Stock compensation expensed		81,250			114,375
Prepaids		(10,663	)		-
A/P		-			3,222
Accrued liabilities		(85,380	)		28,500
Interest payable		10,774			6,904
Net cash provided by operations		(170,704	)		(15,010	)

Investment activities:
Net cash used in investment activities		-			-

Financing activities:
Share subscriptions received		-			1,500
Net cash used in operations		-			1,500

Net increase / (decrease) in cash		(170,704	)		(13,510	)

Balances per prior period balance sheet	$	200,176		$	19,678
Ending balances	$	29,472		$	6,168

Non-cash transactions Conversion of interest payable to equity	$	53,333		$	-

The accompanying notes are an integral part of these condensed financial statements.

SINOBIOMED INC.

Notes to Financial Statements

For the three months ended March 31, 2011

(Expressed in U.S. Dollars)

(Unaudited)

1. BASIS OF PRESENTATION – GOING CONCERN

These financial statements of Sinobiomed Inc. (the “Company”) have been prepared on a going-concern basis which assumes that the Company will be able to realize assets and discharge liabilities in the normal course of business for the foreseeable future.

The Company has experienced losses since commencement of operations amounting to $33,651,256 and has negative working capital and a stockholders’ deficit as of March 31, 2011, which raise substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to meet its commitments as they become payable is dependent on the ability of the Company to obtain necessary financing or achieving a profitable level of operations. There are no assurances that the Company will be successful in achieving these goals.

The Company currently has no operations and no source of income. The Company intends to seek out opportunities to enter or acquire new business operations. The underlying value of the company is entirely dependent on the ability of the Company to find and implement a new business opportunity and obtain the necessary financing to capitalize on such opportunity.

These financial statements do not give effect to adjustments to the amounts and classifications to assets and liabilities that would be necessary should the Company be unable to continue as a going concern.

We have prepared the unaudited condensed financial statements included herein pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim periods. The unaudited condensed financial statements included herein reflect all normal recurring adjustments, which are, in the opinion of our management, necessary to state fairly the results of operations and financial position for the periods presented. The results for the three month periods ended March 31, 2011 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2011 or for any interim or future period.

These unaudited condensed financial statements should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash and Cash Equivalents

Cash equivalents comprise certain highly liquid instruments with a maturity of three months or less when purchased.

SINOBIOMED INC.

Notes to Financial Statements

For the three months ended March 31, 2011

(Expressed in U.S. Dollars)

(Unaudited)

Fixed Assets

Fixed assets are carried at cost less a provision for depreciation on a straight-line basis over their estimated useful lives. Estimated useful lives are as follows:

Computer equipment

3 years

Use of Estimates

The preparation of the Company’s consolidated financial statements in conformity with generally accepted accounting principles of the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Actual results could differ from those estimates.

Loss Per Share

Basic earnings (loss) per share of common stock is computed by dividing the net earnings (loss) by the weighted average number of common shares outstanding during the period.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash, accounts payable, interest payable, interest payable, shareholder loans and other current liabilities. The carrying values of financial instruments reflected in these financial statements approximate their fair values due to the short-term maturity of the instruments.

Stock-Based Compensation

The Company has implemented the provisions of ASC 718 “Compensation-Stock Compensation”. Compensation expense is recorded in accordance with the fair value recognition provisions of ASC 718 for options issued to employees.

New Accounting Pronouncements

There were various other accounting standards and interpretations recently issued, none of which is expected to have a material impact on the Company's financial position, operations or cash flows.

SINOBIOMED INC.

Notes to Financial Statements

For the three months ended March 31, 2011

(Expressed in U.S. Dollars)

(Unaudited)

1. COMMON STOCK

On March 18, 2011, we issued 10,666,666 shares of our common stock to Accelera Ventures Ltd. with respect to the conversion of $53,333 in accrued and unpaid interest pursuant to the convertible debenture issued by the Company on November 11, 2008 in the amount of $250,000 at a conversion price of $0.005 per share. We believe that the issuance is exempt from registration under Regulation S and/or Section 4(2) under the Securities Act as the securities were issued to the entity through an offshore transaction which was negotiated and consummated outside of the United States.

2. STOCK-BASED COMPENSATION

The Company’s 2006 Stock Option and Incentive Plan (the “Plan”) originally allowed the Company to award stock options for up to 10,000,000 (post-forward stock split) shares to its directors, officers, employees, and consultants. On February 9, 2009 the Company increased the number of shares available under the Plan from 10,000,000 shares to 25,000,000 shares. The Plan is administered by the Company’s Board of Directors, or its assigned committee, which has discretion as to the awards and terms of the options to be issued. Upon exercise of options, new shares are issued.

A summary of the Company’s stock option activity during the three months ended March 31, 2011 is presented below:

	Number of options		Weighted Average Exercise Price		Weighted Average Grant-date Fair Value		Aggregate Intrinsic Value
Options Outstanding, December 31, 2010		10,950,000		0.05		0.13	$	0
Less: Options cancelled		2,000,000		0.06		0.06	$	0
Options Outstanding, March 31, 2011		8,950,000		0.06		0.04	$	0
Vested March 31, 2011		625,000		0.03		0.13	$	0
Expected to vest March 31, 2011		3,541,667		0.03		0.13	$	0

Expected to vest options outstanding as of March 31, 2011 will vest equally on a monthly basis as per CEO employment agreement.

SINOBIOMED INC.

Notes to Financial Statements

For the three months ended March 31, 2011

(Expressed in U.S. Dollars)

(Unaudited)

Compensation cost related to options to vest in the future will be recognized as the related options vest. Options outstanding at March 31, 2011 vested as follows:

Vested three months ended	Range of Exercise Prices		Number of Shares		Weighted Average Exercise Price		Compensation Expense to be Recognized		Aggregate Intrinsic Value
December 31, 2010		0.03		833,333		0.03	$	108,333	$	0
March 31, 2011		0.03		625,000		0.03	$	81,250	$	0

The 8,950,000 options outstanding at March 31, 2011 have a weighted average remaining contractual term of 3.1 years.

3. RELATED PARTY TRANSACTIONS

Accounts payable includes $5,000 due to the Company’s Chief Financial Officer for outstanding consulting fees. Other current liabilities includes $20,000 of accrued fees to the Company’s Chief Executive Officer, $78,750 accrued finder’s fees due to shareholders and a Company related to shareholders, and $11,400 accrued consulting fees due to a shareholder.

4. SHAREHOLDER LOANS

The loans from one shareholder in the aggregate amount of $40,000 at March 31, 2011 do not bear interest.

5. SUBSEQUENT EVENTS

On April 5, 2011, the Company entered into a binding Letter of Intent (“LOI”) with Sitoa Corporation (“Sitoa”), a California based corporation that provides an easy-to-use and comprehensive platform that enables an online retailer to deploy a social marketplace e-commerce site. Under the terms of the LOI, the Company is obligated to acquire Sitoa in a share exchange transaction whereby the Company would acquire all of the issued and outstanding equity interests in Sitoa, in exchange for shares of common stock of the Company equal to 80% of the Company’s issued and outstanding shares of common stock as at the closing of the share exchange transaction. The closing is expected to occur no later than June 1, 2011, subject to final approval from Sitoa shareholders.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

You should read the following plan of operation together with our financial statements and related notes appearing elsewhere in this quarterly report and the most recent Form 10-K. This plan of operation contains forward-looking statements that involve risks, uncertainties, and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors.

Overview

From the inception of the Company until the end of November, 2006, we were in business of developing a patent known as the “Car Door Safety Feature”, however, we changed our business plan from the development of the Car Door Safety Feature patent and began focusing on making an acquisition in the Chinese biopharmaceutical industry. On January 12, 2007, the Company completed the reverse acquisition of Wanxin Bio-Technology Limited (“Wanxin”) and all the subsidiaries of Wanxin in accordance with the share purchase agreement, whereby the Company acquired all of the equity capital of Wanxin through the issuance of 1,750,000 (pre forward stock split) shares of Common Stock of the Company in aggregate to the shareholders of Wanxin on a pro rata basis in accordance with each Wanxin shareholder’s percentage of ownership in Wanxin. The foregoing description of the terms of the share purchase agreement is qualified by reference to the Share Purchase Agreement which is attached as Exhibit 10.1 to the Form 8-K/A-1 filed with the SEC on EDGAR on January 16, 2007.

Wanxin is the sole shareholder of Manhing Enterprises Limited, a company organized under the laws of Hong Kong, and Manhing Enterprises Limited is the registered owner of 82% of the capital of Shanghai Wanxing Bio-pharmaceuticals Co., Ltd (“Shanghai Wanxing”). In addition, Shanghai Wanxing is the registered owner of 50.33% of the capital of Shanghai Wanxing Bio-science Cosmetic Co., Ltd. (“Wanxing Cosmetic”).

Shanghai Wanxing is or was a Chinese developer of genetically engineered recombinant protein drugs and vaccines, based in Shanghai.

On March 27, 2009 at Shanghai Wanxing offices in Shanghai, the China Construction Bank visited Shanghai Wanxing with their bailiff and announced the intention to seize all of the assets charged to them under terms of bank loans to Shanghai Wanxing and as affirmed by court order. The bank subsequently executed the seizure of books and records of the Shanghai Wanxing and Wanxing Cosmetic in 2010.

On June 5, 2009 the Company’s Board of Directors formally announced its decision to abandon its operating subsidiaries in China, Shanghai Wanxing and Wanxing Cosmetic, due to the following factors:

	1.	The Company’s President and Chief Executive Officer, who was also general manager of the subsidiaries, resigned his positions with Sinobiomed Inc. but retained management control of the subsidiaries by virtue of his nominee’s status as Chief Representative of the subsidiaries, a legal status in China that is difficult to change without cooperation of the incumbent.

	2.	The debt of the subsidiaries in China exceeded the value of the assets and the prospects for generating sufficient cash flow to repay the debt were doubtful.

	3.	Assets of the subsidiaries were subject to seizure order as noted above.

In December, 2010, the Company completed the abandonment process by entering into a stock purchase and sale agreement (the “Purchase and Sale Agreement”) with China Nonferrous Metals Resource Geological Survey Inc. (“China Nonferrous”), a British Virgin Islands subsidiary of the owner of the 18% minority interest in Shanghai Wanxing, and Wanxin Bio-Technology Limited (“Wanxin”), the Company’s wholly-owned British Virgin Islands subsidiary, pursuant to which the Company agreed to sell 100% of its equity interest in Wanxin to China Nonferrous for an aggregate sale price of $200,000. The Purchase and Sale Agreement was completed on December 23, 2010, which results in the Company no longer having any subsidiary companies.

The foregoing description of the terms of the Purchase and Sale Agreement is qualified by reference to the Purchase and Sale Agreement which is attached as Exhibit 10.1 to the Form 8-K filed with the SEC on EDGAR on December 22, 2010.

On December 10, 2010, the Company acquired the data centre assets of Keychain, Ltd. comprised of eight computer servers and associated fixtures for 4,500,000 shares of the Company’s common stock, which the Company believes will enable the Company to utilize such telecommunications infrastructure to pursue its new business direction of operating a secure data storage and processing environment and engaging in strategic partnerships in the areas of e-commerce, media and social networking.

The foregoing description of the terms of the Asset Purchase Agreement is qualified by reference to the Asset Purchase Agreement which is attached as Exhibit 10.1 to the Form 8-K filed with the SEC on EDGAR on December 15, 2010.

The foregoing description of the terms of the LOI is qualified in its entirety by reference to the provisions of the LOI filed as Exhibit 10.1 to the Form 8-K filed with the SEC on EDGAR on April 5, 2011.

Plan of Operations

Since the disposition of its Chinese subsidiaries the Company has decided to re-focus itself to participate in the growth of e-commerce, media and social networking through acquisitions. The Company believes that the acquisition of Sitoa will allow the Company to participate in the next stage of e-commerce growth. Sitoa’s market opportunity is to provide infrastructure that build marketplaces or “e-malls” for online sellers with focused customer communities to expand their sales channels without the risks of focus dilution, and increased capital and operating costs. Sitoa shares in revenues generated by the marketplace sites in addition to charging one-time integration and hosting fees. Sitoa currently operates a marketplace that is focused on plus-sized women communities and connects them to online apparel retailers. In addition, Sitoa has a pipeline of a number of potential future marketplaces that are focused on communities interested in areas such as fashion, health and cooking.

Need for Additional Capital

To become profitable and competitive, and execute strategic acquisitions, we may have to raise additional capital. If we are unable to raise additional equity capital to develop our business and earn revenues, we will have to suspend or cease operations and our investors may lose their investment.

We have no assurance that future financings will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop, or expand our operations. Equity financing could result in additional dilution to existing shareholders.

Liquidity and Capital Resources

Our registered independent auditors for the year ended December 31, 2010 have issued a going concern opinion as per our most recent Form 10-K. This means that there is substantial doubt that we can continue as an on-going business for the next 12 months unless we obtain additional capital to pay our bills. We have no source of revenues since the abandonment of Shanghai Wanxing and Wanxing Cosmetic. Our only other source for cash at this time is investments by others in the Company. We need to raise cash to fully implement our project and stay in business.

On March 31, 2011, we had a working capital deficit of $268,021 compared with a working capital deficit of $235,919 on December 31, 2010. The increase is due to accrued professional, consultants fees.

Operating activities used $170,704 in cash in the three months ended March 31, 2011. Investing activities in the three months ended March 31, 2011 used zero. There was no net cash flows provided by financing activities in the three months ended March 31, 2011.

We may not have enough working capital to complete our plan of operations. If it turns out that we have not raised enough capital to complete our anticipated business development, we will try to raise additional funds from private placements or loans. There is no assurance that we will raise additional capital in the future or that future financings will be available to us on acceptable terms. If we require additional capital and are unable to raise it, we may have to suspend or cease operations.

Results of Operation

Revenues

We have no revenues in the three month periods ended March 31, 2011 and 2010.

Operating Expenses

Stock-based compensation: Stock-based compensation expenses were $81,250 and $114,375 for the three months ended March 31, 2011 and 2010, respectively. The decrease is due to not having the one-time effect of cancellation of the options of the employees of the Chinese subsidiaries, which occurred in 2009, partly offset by not having the initial vesting of 25% of the options granted in February, 2009 and provision for in-coming CEO share options.

Consulting fees: Consulting expenses were $17,044 and $30,000 for the three months ended March 31, 2011 and 2010, respectively. The decrease was due to different classification on CEO compensation.

Professional fees: Professional fee expenses were $24,206 and $15,674 for the three months ended March 31, 2011 and 2010, respectively. The increase is due to greater involvement of the Company’s external accountants, auditors and lawyer in the current period as the Company was undergoing a re-focus of its operations.

General and administrative expenses: General and administrative expenses were $18,580 and $1,058 for the three months ended March 31, 2011 and 2010, respectively. The increase is due to the accrual of CEO compensation for three months ended March 31, 2011.

Interest expense: Interest expense was $10,774 and $7,435 for the three months ended March 31, 2011 and 2010, respectively. The increase is due to accrued and unpaid interest pursuant to the convertible debenture issued by the Company on November 11, 2008 in the amount of $250,000.

Net Loss

The Company had a net loss of $166,685 for the three months ended March 31, 2011 as compared to net loss of $168,542 for the three months ended March 31, 2010. This decrease in net loss of $1,857 resulted primarily from a decrease in stock-based compensation and consulting fees and an increase in interest expense of the Company during the three months ended March 31, 2011.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company, as a smaller reporting company” (as defined by §229.10(f)(1)), is not required to provide the information required by this Item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e)) under the Exchange Act) that is designed to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as of the end of the period covered by this report, we have carried out an evaluation of the effectiveness of the design and operation of our company’s disclosure controls and procedures. Under the direction of our Chief Executive Officer, we evaluated our disclosure controls and procedures and internal control over financial reporting and concluded that (i) there continue to be material weaknesses in the Company’s internal controls over financial reporting, that the weaknesses constitute a “deficiency” and that this deficiency could result in misstatements of the foregoing accounts and disclosures that could result in a material misstatement to the financial statements for the periods covered by this report that would not be detected, and (ii) accordingly, our disclosure controls and procedures were not effective as of March 31, 2011.

The deficiencies in our internal controls over financial reporting and disclosure controls and procedures are related to: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) inadequate review and oversight of the period-end financial reporting process; and (4) lack of back-up of financial data.

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

1.	We plan to create a position to segregate duties consistent with control objectives and plan to increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us;

We plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us; and

3.	We plan to implement more rigorous procedures for back-up and retention of financial data.

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board.

We anticipate that these initiatives will be at least partially, if not fully, implemented by September 30, 2011.

Changes in Internal Controls Over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during our fiscal quarter of the period covered by this quarterly report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

As at the date of this Form 10-Q filing, there are no material pending legal proceedings to which we are a party or which any of our property is subject, and no director, officer, affiliate or beneficial owner of more than 5% of our common stock, or any associate or any such director, officer, affiliate or beneficial owner, is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceeding.

ITEM 1A. RISK FACTORS

The Company, as a “smaller reporting company” (as defined by §229.10(f)(1)), is not required to provide the information required by this Item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. [REMOVED AND RESERVED]

ITEM 5. OTHER INFORMATION

On November 17, 2008, we entered into a General Security Agreement with R. Douglas Smith in order to provide Mr. Smith with general and continuing security for the payment of all indebtedness and liability of us to Mr. Smith in relation to accounting services provided by Mr. Smith to us. Since a recent indebtedness may have arisen from services provided by Mr. Smith in relation to our recent Form 10-K filing on March 31, 2011 which may be a material amount, we are now attaching a copy of the General Security Agreement to this filing as Exhibit 10.1

The foregoing description of the General Security Agreement does not purport to be complete and is qualified in its entirety by reference to the General Security Agreement, which is attached hereto as Exhibit 10.1, which is incorporated herein by reference.

ITEM 6. EXHIBITS

(b) Exhibit List

	10.1		General Security Agreement between Sinobiomed Inc. and R. Douglas Smith, dated November 17, 2008.

	31.1		Certificate pursuant to Rule 13a-14(a)

	31.2		Certificate pursuant to Rule 13a-14(a)

	32.1		Certificate pursuant to 18 U.S.C. §1350

	32.2		Certificate pursuant to 18 U.S.C. §1350

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		SINOBIOMED INC.

May 23, 2011		/s/ George Yu
		George Yu
		President and Chief Executive Officer
		(Principal Executive Officer)


May 23, 2011		/s/ Khuat Leok Choong
		Khuat Leok (Lionel) Choong
		Chief Financial Officer
		(Principal Financial Officer)

LOGIQ, INC. - FORM 10-Q - May 23, 2011

Attached files

LOGIQ, INC. Reports